Economic pact with Japan will help reduce trade imbalance
The successful conclusion of the Comprehensive Economic Partnership Agreement (CEPA) between India and Japan is expected to elevate trade and economic relations between the two countries to the next level. Though the trade between the two nations remained almost stagnant for decades, it has been growing rapidly for since the past three years. The agreement, which the two sides have agreed on signing soon, will foster new business
opportunities.Prime Minister Manmohan Singh along with his wife Gursharan Kaur arrives at Kuala Lumpur International Airport in Malasiya on Tuesday. — PTI

ArcelorMittal’s new India strategy
To build smaller plants
New Delhi, October 26
As part of a new strategy for India, ArcelorMittal today said it would build, to begin with, smaller steel plants in states of Jharkhand, Orissa and Karnataka instead of mega units as proposed earlier.

A model during the Wills Lifestyle India Fashion Week-Spring Summer in New Delhi on Tuesday. — AFP

Don’t look at IT industry to settle abroad: Murthy
Bangalore, October 26
Youngsters looking to settle abroad, especially the US, courtesy IT industry should opt for career growth within India which offers larger growth opportunities than anywhere else in the world, Infosys mentor NR Narayana Murthy said today.

FIIs set new record, invest $6.11 bn
New Delhi: Overseas funds infused a whopping $6.11 billion in October, the highest amount brought in any single month by the FIIs since they were allowed for investment in local stocks.

Corporate Results
Central Bank of India declares 10 pc dividend
Mumbai, October 26
Public sector lender Central Bank of India today posted 21 per cent rise in net profit to Rs 379.3 crore for the second quarter ending September 30 and declared 10 per cent interim dividend. It had a net profit of Rs 313.9 crore in the same quarter of the last fiscal, Central Bank of India said in a filing on the BSE. The bank also announced an interim dividend of 10 per cent.

Hooda inaugurates ACE commodity exchange
Mumbai, October 26
ACE Derivatives and Commodity Exchange, formerly known as the Ahmedabad Commodity Exchange, is all set to roll out nationally from tomorrow. This was stated by Uday Kotak of the Kotak Mahindra group, who is also anchor investor in the exchange. ACE will be the fifth national commodity bourse after National Multi-Commodity Exchange, National Commodity and Derivatives Exchange, Multi-Commodity Exchange of India and Indian Commodity Exchange Ltd.

The successful conclusion of the Comprehensive Economic Partnership Agreement (CEPA) between India and Japan is expected to elevate trade and economic relations between the two countries to the next level. Though the trade between the two nations remained almost stagnant for decades, it has been growing rapidly for since the past three years. The agreement, which the two sides have agreed on signing soon, will foster new business opportunities, enhance competitiveness of private sectors, and, encourage closer partnership between the private sectors in India’s teeming SMEs and Japan’s infrastructure and hi-technology enterprises.

India is hoping that the CEPA coming into place will also balance out the trade imbalance between the two countries. As of now, the trade between the two countries is strongly in favour of Japan that exports goods worth $3.6 billion to India in the total trade of over $10 billion between the two countries. India is hoping that its generic pharmaceutical and IT sectors will benefit largely as this agreement opens up the Japanese market for India. While Japan exports marine products, iron ore and petroleum products to India, electrical and electronic goods, iron and steel products, chemicals and auto components are exported by India.

Since India-Japan CEPA is truly comprehensive for trade in goods, investment and services, besides allowing movement of natural persons, it will improve the India-Japan partnership and enhance their global partnership. This will also mean that goods being traded will become cheaper, with the lifting of trade barriers.

According to a senior Indian government functionary, the agreement is the next logical step for both countries as they embark on a high-speed journey to cement their economic ties. “With the growing influence of China in the region and its emergence as a global leader, it works well for both India and Japan to come closer and, thus, balance out the power equation in South-East Asia. Hedging against China has become important for both countries,” he explained.

Interestingly, in 1990s Japan was keen on China for its investment and, thus, invested billions of dollars in China, contributing to the rise of China. But as relations between the two countries began to deteriorate and Japan’s own economy began to slow down, the latter started looking for an alternative market. India fit the bill for Japan as the ideal destination, with the economic reforms agenda being in place and the country offering best quality manufacturing at highly competitive prices, besides a skilled workforce. Japan’s industry, which had earlier been wary of quality of Indian manufactured goods, got reassurance when Indian companies started winning the prestigious Alfred Deming prizes for quality manufacturing. Thus, Japan’s interest in India was seen for the first time, making India their perfect ally now.

Though Japan saw the shoddy infrastructure in India as a deterrent, they shifted their aid programme to infrastructure, rather than poverty alleviation. As a result, India is the biggest recipient of Japan’s overseas development assistance and the consequence of which is the Delhi Metro and kicking off of the Dedicated Freight Corridor and Delhi- Mumbai Industrial Corridor, and now the Peninsular Corridor in South India.

Little wonder that for years Japanese investments that remained static at Rs 2,000 crore a year, Japan firms invested a hefty Rs 9,000 crore in 2007. Recent polls in Japan show that 70 per cent of Japanese firms say India is their preferred investment destination. Today, an average of 100 Japanese firms are moving to India every year. The free trade agreement will not only create an economic bond between the two countries, but also make India a major global supplier for Japanese manufacturers.

New Delhi, October 26
As part of a new strategy for India, ArcelorMittal today said it would build, to begin with, smaller steel plants in states of Jharkhand, Orissa and Karnataka instead of mega units as proposed earlier.

The company, however, maintained that it was committed to expanding the capacities of the steel plants later on as stated in pacts with the respective state governments.

“The idea is to set up small steel facilities instead of (big) steel plants so that we have more footprints and we can execute faster some of these ideas," ArcelorMittal CFO Aditya Mittal said in a conference call, after announcing the company's third quarter financial results.

He added, however, “At this point of time, we have not yet announced or decided the size of the plants...the first phase size is yet to be decided.” The world's largest steel producer had earlier proposed to set up Rs 1 lakh crore steel plants with annual production capacity of 12 million tonnes each in Jharkhand and Orissa, and a six million-tonnes per annum unit in Karnataka at an estimated sum of Rs 30,000 crore.

“We will start construction next year,” Mittal said, adding that the plants would go on stream after the work on installation was complete. The company, however, has not decided as to which of its India plants would go off the ground first.

“We are focusing on land acquisition as well as mining licenses (at present),” Mittal said. The company is in the process of acquiring land in Karnataka and Jharkhand and was going slow with regards to the Orissa project.

It said last week that in the first phase of the Jharkhand project, it would trim investments by almost half to about Rs 25,000 crore and build “a six million tonnes per annum plant in 2-3 phase development to begin with".

However, regulatory bottlenecks and protests against land acquisition for the project stymied the mega venture. The company was also forced to move its plant location to Petarwar region in Bokaro district from earlier proposed site in Gumla and Khunti districts. — PTI

Keen on SAIL JV

ArcelorMittal said it was still in talks with SAIL for a possible joint venture even though the state-owned company is in process of finalising a similar deal with Posco. “We have made a proposal to SAIL and we are in discussion with SAIL. With respect to SAIL we have not set any timeline,” ArcelorMittal Group Management Board Member Sudhir Maheshwari said.

Posts $1.35 bn income

ArcelorMittal has reported a net income of $1.35 billion for the third quarter but cautious in its outlook for the fourth quarter. In the July-September quarter last year, the company had a net profit of $910 million, ArcelorMittal said in a statement. "The business performed towards the lower end of our expectations in the third quarter against a background of seasonally lower volumes, weakening spot prices and higher costs," ArcelorMittal chairman and CEO Lakshmi N Mittal said.
— PTI

Bangalore, October 26
Youngsters looking to settle abroad, especially the US, courtesy IT industry should opt for career growth within India which offers larger growth opportunities than anywhere else in the world, Infosys mentor NR Narayana Murthy said today.

“Somehow our youngsters have all assumed the idea of joining this industry is to go to US, get there, get an H1B, convert it into green card and settle down there. I think it is a wrong solution, a wrong strategy," he said while addressing a summit here.

Murthy said one expected youngsters to get good salaries and good disposal of income in India, for which they had to get good quality jobs here. “But their objective cannot be to go and settle down in some other country, especially the US.”

“This time you have a great opportunity to consolidate and by working in India, by becoming a good quality professional you will sustain the advantage we have created and will make growth in India a permanent rather than a temporary feature.”

On wooing back Indian talent, Murthy said there was no need to increase their salaries by 50 times to ensure this. But their lives could be made easier by providing schools, making sure that power condition and commuting is reasonably all right.

“This is being done by many countries in the world. This is nothing new. This is not rocket science," he said, adding there must also be attempts to ensure that the facilities were enhanced. — PTI

On SKS Microfinance

Shubhadeep Choudhury adds from Bangalore: Infosys chief mentor Narayana Murthy today clarified on the “extent of his involvement” in the SKS Microfinance Ltd and said his venture capital fund Catamaran Ventures invested in the firm with an aim to relieve the rural and urban poor from the clutches of moneylenders.

“Money lending to the poor in rural and urban India was primarily in the hands of moneylenders who did not report revenues or interest, and, thus, operated with no scrutiny or transparency. Bringing microfinance into the organised sector allows the sector to be well-regulated, provides for transparency, debate and improvement on interest rates, and helps the poor escape from the clutches of the money-lender sharks,” Murthy said in a statement here today.

The statement, released in the context of “several queries on the investment of Catamaran in SKS Microfinance Limited and the extent of NR Narayana Murthy’s involvement in that company”, made it clear that Murthy had no hand in the running of the company.

Mumbai, October 26
Public sector lender Central Bank of India today posted 21 per cent rise in net profit to Rs 379.3 crore for the second quarter ending September 30 and declared 10 per cent interim dividend. It had a net profit of Rs 313.9 crore in the same quarter of the last fiscal, Central Bank of India said in a filing on the BSE. The bank also announced an interim dividend of 10 per cent.

NTPC profit declines

State run NTPC has announced a marginal decline in its net profit of about 2 per cent at Rs 2,107.38 crore in the July-September quarter. The company had reported a net profit of Rs 2,151.95 crore during the corresponding quarter last year. The company clocked a growth of 20.46 per cent in its net sales, which was at Rs 12,989.29 crore, as against Rs 10,782.79 crore reported for the quarter ended September 30, 2009-10, it said in a filing to the BSE.

Dena Bank net jumps

Dena Bank has posted a 29 per cent rise in net profit to Rs 160.6 crore for the second quarter ended September 30. It had a net profit of Rs 124.6 crore in the same quarter of the last fiscal, Dena Bank said. The total income of the bank increased 23 per cent in Q2 FY'11 to Rs 1,340.3 crore, as against Rs 1,088.1 crore in the year-ago period.

Sterlite Ind profit up

Vedanta group firm Sterlite Industries has posted a growth of over five per cent in its consolidated net profit for the second quarter ended September 30. Sterlite Industries has reported a net profit of Rs 1,008.03 crore in the September quarter of the current fiscal as against Rs 958.85 crore in the same period last fiscal, the company said.

Edelweiss profit

Edelweiss Capital has reported a marginal rise of 2 per cent in its second quarter profit after tax to Rs 66 crore, compared to Rs 65 crore of the same period a year earlier. Total revenue of the company rose sharply by 44 per cent to Rs 376 crore during the quarter ended September 30, against Rs 261 crore of the corresponding quarter last financial year.

P&G net down 39 pc

Procter & Gamble Hygiene and Healthcare (PGHHCL) has posted a 39 per cent decline in its net profit to Rs 31.36 crore for the quarter ended September 30, over the same period last fiscal.

JSW Steel net dips

JSW Steel has said its net profit for the second quarter this fiscal has fallen by 1.35 per cent at Rs 445.44 crore. In the July-September quarter of previous year, the company had posted a net profit of Rs 451.54 crore.
— Agencies

Mumbai, October 26
ACE Derivatives and Commodity Exchange, formerly known as the Ahmedabad Commodity Exchange, is all set to roll out nationally from tomorrow. This was stated by Uday Kotak of the Kotak Mahindra group, who is also anchor investor in the exchange. ACE will be the fifth national commodity bourse after National Multi-Commodity Exchange, National Commodity and Derivatives Exchange, Multi-Commodity Exchange of India and Indian Commodity Exchange Ltd.

ACE was formally launched at a function here by Haryana Chief Minister Bhupinder Singh Hooda. HAFED, a state government undertaking of Haryana, is a major shareholder in the exchange. The other major shareholders are Bank of Baroda, Corporation Bank and Union Bank.

“The new exchange will offer high speed, state of the art trading platform with robust clearing and settlement infrastructure that supports the complete process of trade execution,” Kotak told reporters at the launch function.

Speaking on the occasion Hooda said trading in commodities was all set to increase as India's economy accelerates. "I hope ACE will help professionalise the role of intermediaries so that farmers as well as customers benefit in the long run.” ACE is the first regional exchange to be turned into a national multi-commodity exchange.